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Aid and Growth Have We Come Full Circle?

  • Channing Arndt

    ()

  • Sam Jones

    ()

  • Finn Tarp

    ()

This paper first assesses the aid-growth literature with a focus on recent contributions. The aid-growth literature is then framed, for the first time, in terms of the Rubin Causal Model, applied at the macroeconomic level. The results show that aid has a positive and statistically significant causal effect on growth over the long run with point estimates at levels suggested by growth theory. It has been concluded that aid remains an important tool for enhancing the development prospects of poor nations. [Discussion Paper No. 2009/05]

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Date of creation: Jun 2010
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Handle: RePEc:ess:wpaper:id:2513
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